The Bank of England is resolving the UK branch of Silicon Valley Bank
The Bank of England initiated the resolution of the UK arm of Silicon Valley Bank after it called for £1.8bn of liquidity as its parent company collapsed on Friday.
In a late-night statement, the BoE said it planned to use its bank insolvency procedure, which would allow depositors to withdraw up to £85,000 from the deposit insurance scheme as quickly as possible. The liquidators will manage the remaining UK assets and distribute them to creditors, including large depositors.
Financial advisory firm Interpath has been named as the likely insolvency administrator, according to two people familiar with the matter. Interpath declined to comment.
“SVB UK has a limited presence in the UK and no critical functions supporting the financial system,” the BoE said after US regulators took control of the US parent on Friday. He added that the company would stop accepting payments and deposits.
The decision to time SVB UK’s draw comes after the bank resorted to the BoE’s discount window, which offers banks short-term funding, for £1.8bn on Friday.
A spokesman for SVB’s British branch did not immediately comment.
On Friday afternoon, SVB UK issued a statement on Twitter emphasizing that it was a “stand-alone, independent banking institution”.
“We appreciate that this is a worrying time for our customers, so we’re working tirelessly to support them and provide more context,” said Erin Platts, chief executive and head of SVB UK. The tweet has since been removed.
Created As SVB’s first overseas branch in 2012, the British division became a subsidiary last August. It boasted a team of 700 people in Europe, the Middle East and Africa, a it beeps from the UK bank’s official account at last week’s awards ceremony.
Additional reporting by Michael O’Dwyer and Brooke Masters in New York